Fresh bull run in economy
5 themes for a portfolio to bet on bounceback in the economy
Top five themes which our analysts think can pick up momentum as and when the economy picks up momentum:
- The midcap theme could do better: Midcap and smallcap stocks are usually seen as proxies to economic recovery.
- NBFCs are creating a huge opportunity: Investors can look at the NBFCs for regional franchises with good balance sheets
- Auto stocks good for proxy to growth: strong demand for auto stocks, we belive that run has been very good and valuations being where they are.
- Private sector banks better placed: Shares of banks or financials are seen as a proxy for growth in the domestic economy. A bounce back in growth could lead to an increase in credit.
- Domestic cyclials: cyclicial stocks, or economy- related stocks, are better positioned to ride the recovery the earnings momentum could be better in domestic cyclicals as demand for goods and services increases.